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United States District Court of Maryland Rules in Favor of Landlord by Finding Exculpatory Clause Valid

Frank R. Nerenhausen, et al. v. Washco Management Corp. et al.
Civil No. JKB-15-1313 (United States District Court of Maryland)
by Marie Claire Langlois, Law Clerk
Semmes, Bowen & Semmes (www.semmes.com)

Available at: http://www.mdd.uscourts.gov/recent-opinions

Plaintiffs rented a furnished townhome from the Defendants, which included, as part of the furnishings, a coffee table with a metal frame and a top constructed from non-tempered glass. On January 4th, 2014, plaintiff, Frank Nerenhausen, sat on the edge of the coffee table, located in the first floor living room, to tie his shoes. Unfortunately for Mr. Nerenhausen, the coffee table shattered, puncturing his right buttocks, lacerating his pudendal artery, and causing nerve damage.

Plaintiff’s complaint alleged negligence, breach of implied warranty of habitability, and loss of consortium. Yet, the parties’ lease for the property included an exculpatory clause which stated:

Except to the extent prohibited by applicable law, neither the Owner nor Manager shall be liable for any damage, loss or injury to persons or property occurring in, on or about the apartment or the Premises. You, Occupant, or their [sic] respective guests, invitees, or agents agree to save and hold Owner and Manager harmless and indemnify Owner and Manager from any liability or claim to the fullest extent permitted by law.

As a result, Defendants filed for summary judgment arguing that this clause absolved them from liability resulting from any alleged negligent acts.

Plaintiffs filed not one, but two, amended complaints, the second, which came fourteen months after the November 6, 2015 deadline for amended pleadings. The Court first analyzed whether such amended complaint should be considered despite its tardiness. The Court stated that in order to consider a late amended pleading, the party must satisfy the standards for “good cause” as required under Federal Rule 16(b)(4). Some of the things considered in a good cause assessment are (1) the timeliness of the amendment, (2) the reason for tardy submission, and (3) diligence on the part of the moving party. Odyssey Travel Ctr., Inc. v. RO Cruises, Inc., 262 F. Supp 2d 618, 632 (D. Md. 2003).

Plaintiffs’ second amended complaint included only one change: an addition of a new claim based on strict liability. Plaintiffs stated that they did not include this claim previously because it was only recently discovered through “experts reports and testing by their experts, and other documents in discovery,” yet they failed to specify what this new profound evidence was, nor did they explain how it would support a claim under strict liability. This lack of diligence, in addition to the Plaintiffs’ excessive tardiness, gave the Court reason to deny Plaintiffs’ motion to amend.
Without allowing a claim for strict liability, the Court then analyzed the Defendant’s summary judgment motion under the Plaintiffs’ original claims of negligence, breach of warranty, and loss of consortium. For a court to grant a motion for summary judgment, there must remain no genuine dispute as to any material fact and, under such facts, the moving party must be entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). The burden of proof is on the moving party and the facts must be viewed in a light most favorable to the non-moving party. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157 (1970); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

While the Court recognized that for public policy reasons, Maryland generally supports the validity of exculpatory clauses under a freedom to contract theory, there are a few situations under which a landlord cannot release their liability. Specifically, the Court stated that a landlord cannot be indemnified for liability which occurs “on or about the leased premises or any elevators, stairways, hallways, or other appurtenances used in connection with them.” Md. Code Ann., Real Prop. § 8-105. Thought there is an exception to the exception: the Court will not invalidate an exculpatory clauses as it relates to areas of the rental property “within the exclusive control of the tenant.” Id.

Although the Defendant reserved a right of entry for “reasonable business purpose[s],” the Court still believed that the living room, and the coffee table itself, were in the Plaintiffs’ exclusive control. Plaintiffs’ lack of control over the selection of the specific coffee table was not enough to change this conclusion, given that previous courts have found to the contrary. See Shell Oil Co. v. Ryckman, 403 A.2d 379, 382 (Md. Ct. Spec. App. 1979) (In comparison to the coffee table, the plaintiffs had not control over the landlord’s choice of glass door in Ryckman.) Moreover, the broadly-worded language of the exculpatory clause, indemnifying the Defendants from “any liability or claim” did not remove Plaintiffs’ obligation from claims or liability from the Defendants’ negligence.

Upon this conclusion, the Court then quickly dismissed the remaining claims. Because the Plaintiffs did not respond with a counterargument to Defendants’ argument on the breach of implied warranty of habitability, the Court considered such an argument waived. Lastly, the Court found that a claim for loss of consortium was derivative on the spouse’s underlying personal injury claim, and without the ability to bring a negligence claim or claim for breach of warranty, such a claim could not succeed.